20-Aug-2018 6:55 AM
IATA: 2Q2018 financial results show 'moderate squeeze on airline profitability'
IATA released (19-Aug-2018) its Airlines Financial Monitor for Jun-2018 to Jul-2018. Key points include:
- Initial 2Q2018 data point to a moderate squeeze on airline profitability compared to the same quarter a year ago. However, industry-wide cash flow generation increased compared with 2Q2017;
- Global airline share prices rose for the first time since Jan-2018 and outpaced developments in the overall global equity index. The improvement in the airline share price index was dominated by North America, with modest gains in Europe and the Asia Pacific. Airline shares are still 10% lower than at the beginning of 2018;
- Oil prices eased slightly again in Jul-2018, but the upward trend remains in place. Jet fuel prices dipped back below USD90 per barrel during Aug-2018, but remain almost 40% higher than their level of a year ago;
- Notwithstanding rising input costs, there are signs of renewed downward pressure on passenger yields. Yields in the less price-sensitive premium-class cabin have generally proven to be more resilient than the economy cabin, despite signs of weakness in May-2018;
- Passenger demand carried solid momentum into the peak Northern Hemisphere summer period, but freight demand is showing signs of some moderation. [more - original PR]